BCRD and DGM analyze importance of the sector for the country’s economy

The governor of the Central Bank of the Dominican Republic (BCRD), Héctor Valdez Albizu, held a meeting with the general director of Mining, Rolando Muñoz Mejía and the advisor to the Executive Branch for the same sector, Miguel Peña De los Santos, in which the importance of the mining sector for the Dominican economy was analyzed.

At the meeting, it was highlighted that the added value generated by mining within the Gross Domestic Product (GDP) in the Dominican Republic in 2020 amounted to RD$89,231.2 million, equivalent to 2.0% of the GDP, the most important items being gold, sand, gravel and gravel, ferronickel, silver, marble, copper and gypsum.

Likewise, the general director of Mining informed that over the next three years, investments of some US$3.4 billion are programmed to extend the useful life of existing mines and for new extraction projects, in an environmentally responsible context.

Muñoz Mejía and Peña De los Santos asked Valdez Albizu for the support of the Central Bank for the creation of a mining satellite account, subject to international methodological requirements, and the establishment of an information exchange system between the General Directorate of Mining and the National Accounts Department of the Central Bank, to facilitate the analysis of the contributions of mining to the country’s economy with greater detail and disaggregation.

For his part, Governor Valdez Albizu welcomed the proposal to carry out detailed studies of the mining sector in the Dominican Republic and its impact on the GDP, as well as the interaction and linkages of mining with the rest of the economic activities and particularly with construction.

In this regard, by way of example, it was pointed out that the production of cement, increasingly important in the country, has its origin in mining extractions, although by international methodological convention, the added value of the cement industry is registered within the local manufacturing activity.

The Governor took the opportunity to recall that the national accounts statistics collected by the Central Bank are compiled following the methodology and standards established by international organizations such as the statistical division of the United Nations (UN), the International Monetary Fund (IMF), the World Bank (WB), the Organization for Economic Cooperation and Development (OECD) and the International Labor Organization (ILO).

Valdez Albizu informed that according to BCRD forecasts, the Dominican economy will grow this year at a double-digit rate, that is, 10% or more, and that the nominal GDP of the Dominican Republic will close 2021 at more than US$ 91.5 billion.

He added that the Central Bank’s international reserves reached a historic high of US$ 13,060.3 million at the end of August 2021, equivalent to 7.5 months of imports and 14.3% of GDP, above the metrics and thresholds suggested by the IMF of 3 months of imports and 10.0% of GDP, respectively.

For his part, the Director General of Mining expressed to the Governor the importance for the Dominican Republic of maintaining macroeconomic stability after the negative economic impact caused by the COVID-19 pandemic and highly valued the role played by the Central Bank, an institution which opportunely adopted a broad program of liquidity provision and monetary stimulus measures which facilitated the channeling of loans to companies and households for more than RD$215 billion (5.0% of GDP).

At the meeting, Governor Valdez Albizu was accompanied by Central Bank Manager Ervin Novas Bello, Economic Advisor Julio Andújar Scheker and Deputy Manager of National Accounts and Economic Statistics, Ramón González Hernández.

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